Who invests in home equity to exempt wealth from bankruptcy? : [This draft: May 2013]
- Homestead exemptions to personal bankruptcy allow households to retain their home equity up to a limit determined at the state level. Households that may experience bankruptcy thus have an incentive to bias their portfolios towards home equity. Using US household data for the period 1996 to 2006, we find that household demand for real estate is relatively high if the marginal investment in home equity is covered by the exemption. The home equity bias is more pronounced for younger households that face more financial uncertainty and therefore have a higher ex ante probability of bankruptcy.
| Author: | Stefano Corradin, Reint GroppGND, Harry Huizinga, Luc Laeven |
|---|---|
| URN: | urn:nbn:de:hebis:30:3-305746 |
| URL: | http://ssrn.com/abstract=2268926 |
| DOI: | https://doi.org/10.2139/ssrn.2268926 |
| Parent Title (German): | SAFE working paper series ; No. 21 |
| Series (Serial Number): | SAFE working paper (21) |
| Place of publication: | Frankfurt am Main |
| Document Type: | Working Paper |
| Language: | English |
| Year of Completion: | 2013 |
| Year of first Publication: | 2013 |
| Publishing Institution: | Universitätsbibliothek Johann Christian Senckenberg |
| Release Date: | 2013/06/27 |
| Tag: | Home ownership; Homestead exemptions; Personal bankruptcy; Portfolio allocation |
| Issue: | Draft: May 2013 |
| Page Number: | 49 |
| HeBIS-PPN: | 348830319 |
| Institutes: | Wirtschaftswissenschaften / Wirtschaftswissenschaften |
| Wissenschaftliche Zentren und koordinierte Programme / House of Finance (HoF) | |
| Wissenschaftliche Zentren und koordinierte Programme / Center for Financial Studies (CFS) | |
| Dewey Decimal Classification: | 3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft |
| Sammlungen: | Universitätspublikationen |
| Licence (German): |  Deutsches Urheberrecht |
